Stopping Pogos will raise vacancies in Manila, Cebu

CEBU will suffer from empty office spaces should the government stop the businesses of the Philippine Offshore Gaming Operators (Pogos).

In a news report, the Philippines will stop operations of 175 offshore gambling firms and deport about 40,000 Chinese workers, a justice ministry official said on Monday, September 25, 2022.

“The crackdown was triggered by reports of murder, kidnapping and other crimes committed by Chinese nationals against fellow Chinese nationals,” justice ministry spokesperson Jose Dominic Clavano IV said as quoted in a report.

Colliers associate director of research Joey Roi Bondoc said such move could affect Cebu’s office market.

“It will raise vacancies and lower rent definitely. We might see developers now paring down supply because of slower demand in the market,” he said.

“Metro Manila and Cebu are likely to suffer as these used to host a lot of Pogos,” he added.

Pogos in Cebu mostly operate in Lapu-Lapu City. During the pandemic, Pogo workers were compelled to go back to China, leaving some office buildings empty.

Colliers had earlier said the exodus of Pogos during the start of the pandemic exacerbated the property slowdown where office vacancies soared and take-up of pre-selling condominiums plummeted.

The Pogo industry boomed in the early years of the Duterte administration. Many Pogos, which employ mostly Chinese nationals, closed up operations in the Philippines due to higher taxes and pandemic-related travel restrictions. Pre-pandemic, this industry occupied 1.3 million square meters in office spaces.

In the last two years, the Pogo industry has vacated about 500,000 square meters of office space.